Nintendo Creates Division to Develop Home Information Network

August 10, 1989

REDMOND, Wash. (AP) _ Nintendo of America Inc. has set up a new division to develop its Nintendo Entertainment System as a home computer terminal for services such as news, home banking, and long-distance video game playing.

Nintendo also announced Wednesday that Jerry Ruttenbur, a senior vice president with Home Box Office’s video division, has been hired as vice president of network products to lead the development. Ruttenbur is to begin his new job in October.

Minoru Arakawa, president of the Japanese company’s U.S. subsidiary, said Nintendo wants to have an interactive entertainment and informational network in the marketplace sometime in 1990.

The Nintendo network would compete with such services for personal computers as Prodigy, which is owned by International Business Machines Corp. and Sears, Roebuck & Co., and CompuServe, which is owned by H&R Block Inc.

″By year-end, more than 20 million U.S. households will have the NES, and in 1990, each of these households will have access to the ’NES Network,″ Arakawa said.

Nintendo’s entertainment system, an electronic device that retails for $80 to $100, has been one of the most popular toys in this country for the past several years. The system hooks up to a television set to display such games as ″Super Mario Brothers 2,″ ″Zelda II,″ and ″Mike Tyson’s Punch-out.″

Nintendo Co. Ltd., the Japanese parent company, already delivers an assortment of information over its ″Family Computer″ devices to 150,000 Japanese households, Nintendo spokesman Richard Lindner said Thursday.

Lindner said the U.S. subsidiary has talked with American Telephone & Telegraph Co. about the technological possibility of having Nintendo devices form part of an information delivery network.

″Several major and recognizable companies have approached Nintendo to ask how they can become involved,″ Lindner said. He declined to give any names, saying no formal agreements have been signed with AT&T or any other company.

Arakawa said that while plans for the Nintendo network are still being developed, the core component of the system, the control deck, would act as a network terminal.

″A modem and proprietary software will provide such services as stock purchase and trading as well as home banking,″ he said. ″In addition, Nintendo video game fans will be able to compete one-on-one with players around the country using the ’NES Network.‴

The Family Computer system uses the same processor unit as the U.S. Nintendo gear, with the addition of a keyboard and a device that combines a computer disk reader with a facsimile machine. Lindner said that beyond the control deck, the configuration and equipment for the U.S. system has not yet been determined.

By the end of the year, Lindner said, Nintendo estimates it will have its games in 21 percent of U.S. households.